THE BACKGROUND - Next month, Unilever's Home and Personal Care division will mount a £7m television and print ad campaign to support the relaunch of Comfort, the UK's top selling fabric conditioner. The push will feature a new fragrance variant, packaging and tagline ('Soften things up'). Unilever's marketing exercise is typical of activity in the fiercely competitive laundry detergents sector, which is known for big advertising and trade budgets, with its drive for product innovations, line extensions and design tweaks all designed to keep consumers interested and loyal.
The clothes-washing detergents market is worth more than £1.2bn, according to Mintel, with Unilever and Procter & Gamble's brand portfolios fighting it out for market share. But while it is a sizeable sector, it is declining in real terms as the grocery multiples keep prices low in their own battle to attract customers to their stores.
The sector includes detergents and laundry aids such as fabric conditioners and stain removers, and in the past year some of the most interesting new product development has taken place in the laundry aids area.
The growing number of one-person households and smaller families are a big challenge for manufacturers. But in line with other markets, convenience and labour-saving products are proving very popular, with time-pressured consumers willing to pay for these benefits. Since tablets appeared in June 1998 they have gained consumer approval. Unit doses of powder and liquids (which were launched by the Co-op in 2001) accounted for 40% of sales by value in 2004. Buyers tend to be format-loyal, sticking with powders or liquids.
Consumer interest in this category is sustained by new product development and the manufacturers support their launches with heavyweight advertising.
Recent activity with new formulations has included adding oxygenating ingredients and introducing quick- and cool-wash detergents.
However, the constant difficulty for brands in this market is that while investment in R&D is required to stimulate consumer interest, the supermarkets are keeping prices down. So although the total market was worth £1.16bn last year, that was a 2% decline on its 1999 value in real terms.
Developing variants
Mintel estimates that in 2004 the clothes-washing detergent segment of the market was worth £819m, 3% down on 2002, while sales of fabric conditioners grew 12% to £275m over the same two years.
Unilever UK Home and Personal Care's (previously known as Lever Faberge) Persil is the market-leading washing detergent, with 29% market share by value. Its range consists of several products, including Persil Bio, Persil Non-bio, Persil Colour Care and Persil Silk & Wool. As the company has rationalised its brands it has tried to convert former Lux users to the latter product. In May 2004 the brand was reformulated with a new enzyme to enhance cleaning of its biological and colour care products.
Since the company ditched its Radion brand in 1999 it has successfully converted many of its customers to Surf, which is now Unilever's main fragrance brand. Last year the manufacturer invested £4m in repositioning Surf as an upmarket product for younger families. During the past couple of years Surf has been the UK's fastest growing detergent brand, according to Mintel.
Capsule breakthrough
Unilever's portfolio also boasts the UK's best-selling fabric conditioner, Comfort, which has a 45% share of the market. Recent product development has also taken the brand into ironing aids and clothes refreshment. In October last year the company introduced Comfort Pearls, the first fabric conditioner capsule, which is regarded as a major technological breakthrough in the category.
Rachel Kelly, Comfort's UK brand manager says: 'Comfort Pearls mean less waste and mess and will change the way consumers perceive fabric conditioners.
They give fabric conditioners the same convenience and benefits as capsules and tablets do for laundry cleaning.'
The Pearls retail at £2.39 for a box of ten and are supported by a £7.5m marketing package. 'There is an opportunity for retailers to deliver stronger profitability by trading consumers up to this premium offering,' adds Kelly.
While Unilever owns two of the best-selling brands in this market, Procter & Gamble is the leading manufacturer, with 50% share of value sales. Its portfolio includes Ariel, Bold and Daz.
Ariel is its leading brand, with a range including Liquitabs, Colour, Handwash and Non-Bio. Last year its positioning was founded on its effectiveness at lower temperatures. P&G's Bold 2-in-1 washing powder and conditioner, which is promoted as a money-saving product, was revamped in 2004 to include new fragrances and packaging.
Specialist products
The Fairy brand has a distinct positioning because of its non-bio and softening properties, which makes it popular with parents of babies and young children. The brand is also endorsed by the Royal College of Midwives.
The rest of the market is taken up by smaller brands and specialist products such as Reckitt Benckiser's Vanish stain remover as well as the supermarkets' own-label detergents.
Mintel's consumer research suggests that consumers tend to be loyal, with four out of ten sticking with the same brand. About a quarter change occasionally, generally influenced by price promotions and offers. While these promotions are used to promote trials some formats such as tablets and liquids are priced higher.
Because of the continuing pressures on the market, Mintel predicts that future growth will be modest, with the total market value reaching £1.2bn by 2009. Innovation and marketing support will continue to be needed to maintain consumers' interest, with possible areas of development including the introduction of products to help allergy sufferers and fabric-specific products, such as for viscose clothes.
CLOTHES-WASHING DETERGENT SALES BY MANUFACTURER AND BRAND SHARE
Brand 2004* 2002 02-04
pounds m % pounds m % % change
1 Total Procter & Gamble 447 52 428 51 7.4
Ariel 178 20 169 20 7.1
Bold 117 14 116 14 -1.0
Daz 76 9 75 9 18.5
Fairy 65 8 60 7 4.1
Dreft 3 1 8 1 -28.9
2 Total Lever Faberge 283 34 292 35 -6.9
Persil 227 26 233 28 -6.6
Surf 53 6 54 6 -10.3
Lux/Stergene 11 2 5 1 334.4
3 Others/own-label 111 14 124 15 -12.3
Total 842 100 844 100 -0.2
Source: Mintel *Estimated
ADSPEND ON WASHING POWDERS BY LEADING SPENDERS
Brand 2004* 2002 02-04
£000 % £000 % % change
1 Total P&G 30,910 42 38,160 48 43
Ariel 10,067 14 14,767 19 16
Daz 7089 10 7357 9 9
Bold 7708 10 6862 9 8
Fairy 2003 3 4676 6 4
Bounce 10 ** 38 ** **
Lenor 4014 5 3882 5 5
Other P&G products 19 ** 578 2 **
2 Total Lever Faberge 35,139 48 36,102 45 46
Persil 20,082 27 19,832 25 24
Surf 5189 7 7227 9 9
Comfort 9868 13 9043 11 12
3 Total Reckitt Benckiser 6064 8 4805 6 7
Vanish 5636 8 3481 4 5
Woolite n/a n/a 151 ** **
Calgon 428 1 1173 1 2
4 Other Brands 1769 2 742 1 4
Total 73,882 100 79,809 100 100
Source: Nielsen Media Research/Mintel *January-October **less than 0.5%
Note: Data may not equal due to rounding
ANALYST COMMENT - MATTHEW WARD, ACCOUNT MANAGER, TNS
At £924m the clothes cleaning market is sizeable, but only showing slight growth, up 0.7% in the year to January, according to TNS figures.
Main wash dominates the sector with a 67% share of the market, but has had a tough year, with its value down by 0.7%. This decline is a result of the 22.1m households that buy main wash products spending 28p less on average this year than last. One reason they are spending less is that they are returning to the market less often, due to the number of bigger packs on offer.
It has been a mixed performance for brands, with the two biggest players, Persil and Ariel, suffering a significant loss of buyers. Fairy had the most successful year, creeping into double-digit growth with the introduction of Capsules to its otherwise static range. Daz also had a successful year, stepping up its promotional activity and picking up buyers lost from Persil and Ariel.
Bold has managed to turn its performance around with the successful relaunch of its fragrances, plus the introduction of a Lavender and Camomile variant.
Although Surf relaunched its fragrances this year, it has lost more buyers since.
The real success story in clothes cleaning over the past two years has not come from the larger main wash sector, or dominant manufacturers.
Stain removers, up almost 20% in value, and despite accounting for less than 10% of clothes cleaning sales, were responsible for bringing the market into slight value growth. The sector's success is largely down to Reckitt Benckiser brand Vanish, helped by the launch of Oxi-Action.
This growth has not come at the expense of main wash product sales, with consumers' spend on stain removers incremental to clothes cleaning as a whole.
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